Nicaragua in 1999 was still reeling from Hurricane Mitch. With its economy already devastated by two wars (1978–79, 1981–90) and increasingly corrupt and incompetent governments, the country then had to cope with 4,000 dead or missing persons, 700,000 others who had been displaced, and $1.5 billion in damages caused by the hurricane that struck in October 1998. After eight years of downsizing mandated by the International Monetary Fund, Nicaragua’s social service infrastructure was inadequate to deal with such disaster.

Mitch also affected politics. Surprisingly slow in declaring a national disaster, the Alemán administration tried to channel domestic and international relief either through local governments where Alemán’s Liberal supporters were in power or through Liberal organizations where they were not. The administration also tried to tax and control private international relief aid but was dissuaded by domestic and international criticism.

Public confidence in Alemán was further eroded by charges of corruption. Throughout 1999 Comptroller General Agustín Jarquín leveled charges of personal corruption against the president. Although Alemán countercharged and eventually arrested his respected adversary, opinion polls indicated that most Nicaraguans saw their government as unprecedentedly corrupt.

The other major party, the Sandinista National Liberation Front (FSLN), was also floundering. Tarnished in 1998 by charges of sexual abuse of a stepdaughter, FSLN leader Daniel Ortega failed to respond to widespread calls that he step down and make way for a new leadership.

With polls showing support for the two major parties at lows of 20% each, archrivals Alemán and Ortega further offended the public by making a pact to protect their economic and partisan interests. By utilizing a working majority in the legislature, they packed the office of the Human Rights Ombudsman, the Supreme Electoral Council, the Supreme Court, and the office of the comptroller general with their supporters and altered electoral laws to make it more difficult for smaller parties to challenge the two major ones.

Nicaragua’s ranking on the UN Development Program’s Human Development Index, which measures citizens’ health, educational opportunities, and wealth, had dropped from 85th when the Sandanistas left office in 1990 and 117th at Alemán’s inauguration in 1997 to 126th in 1999.